Avoiding a Pyrrhic victory for Cameron

Paris and Berlin essentially share the same attitude toward David Cameron’s efforts to win the EU referendum: they aim at avoiding both Brexit and a downgraded Europe. Germany and France are committed to a strong EU with the UK as a member. When necessary to overcome current challenges, they also believe that further integration, “more Europe”, is needed for the Union.

Of course, there are nuances between the two capitals. Germany insists on the four freedoms as central to the acquis. France puts the stress on equality of treatment as a key principle. Germany feels close the UK’s economic liberalism whereas France has a tradition of working with the UK to further EU foreign and defence policies. But at the end of the day, their goal remains highly complementary. Both countries want to avoid new veto players or veto constellations. France as much as Germany is opposed to giving red card power to national parliaments or to limit the Eurozone ability to move toward greater integration, among other British requests.

Both Merkel and Hollande believe that the UK’s concerns could be addressed without altering the treaty or key European integration principles if London was willing to go down that road.

Treaty change is one of the key points currently discussed in the UK. But it does not come under Germany and France’s current plans. Modifying the “ever closer union” provision is a non-starter: it would not just impact the pace and geometry of European integration, but rather change the final destination. Others concerns are palatable, but would rather be picked up in due course in the context of a broader reform that includes other priorities and issues. At the end of the day, the current approach from both capitals is to work under the existing treaty at least until 2017, as per last June’s so-called Five Presidents’ report on the economic and monetary union, which will incidentally allow for national elections to have taken place both in France and Germany.

Both Merkel and Hollande believe that the UK’s concerns could be addressed without altering the treaty or key European integration principles if London was willing to go down that road. In any case, the outcome of the British referendum is likely to depend less on the results of a “negotiation” than on collateral topics, such as immigration. Plus, if Cameron is to win, it will definitely be with votes from his left, which suggests that part of his social agenda should be considered with some distance.

Still, Cameron’s initiative does not allow for only intransigence or status quo. Both France and Germany are well aware that, just as he did in Scotland (or previous French governments did with previous referendums on the European construction, for that matter), the British Prime Minister called for the referendum without guarantees on the endgame. They have therefore been working – and consulting each other – over the compromises that will help delineate the landing zone of the current talks: how to counter misuse of member states’ welfare system, how to make the most of parliamentary consultation process, how to move forward in terms of completing the single market.

[Cameron] has not made his list of requests public. He has not announced yet when he will hold the referendum. And he will want to show that the deal will have been hard-fought until the last minute, also to avoid calls to reopen the negotiation.

Germany and France’s response also needs to take tactics into account. Cameron already plays this card heavily. He has not made his list of requests public. He has not announced yet when he will hold the referendum. And he will want to show that the deal will have been hard-fought until the last minute, to avoid calls to reopen the negotiation for a better one. So far, Merkel has shown that she does not believe it wise to engage openly on the issue in the British debate. And Hollande has chosen the same course, except to make clear his rejection of treaty change so as to contain Cameron’s constituency’s one-upmanship.

For France and Germany, the issue is of course also about leadership in the EU. When it comes to advancing integration, France and Germany share priorities – as laid out for instance last May by Merkel and Hollande – on areas where Britain has decided not to participate in, such as a more strategic steering of the Eurozone. And if nobody loves red tape, not everyone sees it with the same lens: completing the digital single market for instance will require effective rules on data protection, copyright, public good components and the like.

[The UK] cannot opt out from several European policies and yet ask for having a say in the way others move forward on those policies.

But there is a deeper issue at stake. Even in Germany, where Schäuble showed some understanding for British concerns over the fact that “states outside the eurozone should not be at disadvantage in the EU”, this understanding does not go to the point where the UK can ask for a more integrated Eurozone and yet object to it when it sees it as hitting its interests. It cannot opt out from several European policies and yet ask for having a say in the way others move forward on those policies. Comparing recent statements by Emmanuel Macron and Wolfgang Schäuble two rather different notions of more Europe by way of deeper integration show up – both of them, however, are light years away from David Cameron’s vision of Europe.

Very few in Paris or Berlin would bet on the UK turning into a “normal” or even committed member of the EU. On the other hand, many hope that Cameron will find a way to keep Britain in, including with a deal that confirms its ability to shape that future if it stays in. After all, Britain’s exit would damage the integration project at a time when more robust decisions are required. In this sense, Brexit could become a toxic precedent. But letting the Eurosceptics have it their way has its risks, too: A British referendum won through a deal that would block the EU’s ability to move forward would be a Pyrrhic victory – for France and Germany, for the EU, and ultimately for Great Britain as well.